London
The UK’s economic output grew by just 0.2% in July, according to government figures published this week. City analysts had predicted a stronger bounceback (of 0.4%) from June, when an additional bank holiday for the Queen’s platinum jubilee helped cause a sharp 0.6% month-on-month contraction. Yael Selfin, chief economist at KPMG, said the “feeble” growth rate in July suggested the UK economy was still smaller than in May, reflecting a summer dominated by sharply rising inflation expectations and fears over the cost of living. “This ties into a downbeat outlook for the UK economy which could see another shallow recession from the end of this year, driven by the ongoing squeeze on households’ income and a rising cost burden for businesses,” she said. Indeed, the disappointingly small rebound in GDP in July “suggests that the economy has little momentum and is probably already in recession”, said Paul Dales, chief UK economist at Capital Economics. There was better news on unemployment, which fell to a new 47-year low
